Dairy doing it tough

By Rodney Woods on March 04, 2017
  • Dairy doing it tough

    ‘‘I think it’s bang on the money. We haven’t got an increase in the milk price yet so we are still not making money,’’ says dairy farmer Ian Goodin.

Milk production failed to increase and input costs were also on the decline during the past year, according to a new Dairy Australia report.

And local dairy farmers say the issues mentioned in Dairy Australia’s most recent Dairy Situation and Outlook report are a good representation of the industry closer to home as farmers continue to struggle after the milk price cut in April last year.

The Dairy Situation and Outlook report said milk production margins remained tight or negative, and many farmers faced a significant task rebuilding their equity position after the past 12 months.

Yarroweyah dairy farmer Ian Goodin agreed with the report.

‘‘I think it’s bang on the money. We haven’t got an increase in the milk price yet so we are still not making money,’’ Mr Goodin said.

‘‘Equity is going to be huge. We really need a good year next year to get back to square one.’’

Barooga farmer Jason Brooks agreed that margins remained tight.

‘‘That would be true. Our income would be down 50 per cent — 30 per cent in production and 20 per cent would be (the milk) price,’’ Mr Brooks said.

The year-on-year drop in Australia’s milk production has moderated, according to the report, from more than 10 per cent for the first four months, to 8.5 per cent for the July to December period, with Dairy Australia expecting this gap will narrow further but remain significant as it forecasts full season production to be down by six to eight per cent on the 2015-16 total of 9.5billion litres.

Victoria’s 10th-wettest spring on record saw northern Victorian dam levels up, temporary water prices down and the report also mentioned a decline in wheat and hay prices throughout the Goulburn and Murray valleys.

Spring rainfall in the Murray-Darling Basin was above average by 64 per cent, while the Dartmouth, Hume and Eildon dams registered 78 per cent, 85 per cent and 76 per cent capacity respectively at the start of this month, in comparison to figures of 46, 38 and 43 per cent at the same time last year.

Dairy Australia’s report also found that wheat and hay prices were down, with stockfeed wheat at $230/tonne at December last year and shedded cereal hay sitting at $148/tonne also at the end of last year.

The rain brought relief to farmers in northern Victoria as well as those across the border, with temporary water prices trading at $160/Ml south of the Victoria-NSW border and $118/Ml north of it.

Both figures were down significantly from the previous year.

‘‘Last year if you had 50 grand you could only buy so much, you can buy seven or eight times more this year,’’ Mr Goodin said.

The report also suggested that Meat and Livestock Australia was predicting the possibility of cattle prices easing by 20 to 40 per cent in its 2017 Industry Projections Report and culling of cattle had increased in the 12 months to January 2017 by 16 per cent.

By Rodney Woods on March 04, 2017

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